How heavy drinking could add £2,000 a year to your pension

| September 10, 2012 | 0 Comments

  • Heavy drinkers could soon qualify for bigger pension payouts then people who are clean living
  • Insurance companies set to dish out more money to retirees with liver damage caused by drinking

By
Dan Hyde

18:09 EST, 7 September 2012


|

08:39 EST, 10 September 2012

Binge drinkers are to be given better pension payouts by insurance companies, it emerged last night.

Those who swig more than four bottles of wine or 15 pints of beer a week could qualify for up to £2,000 a year more than someone who is clean living.

Insurance companies have always dished out more money to retirees who suffer from poor health. This is because they are less likely to live as long as someone who has not had any medical problems.

Boost: Those who drink more than four bottles of wine or 15 pints of beer per week could qualify for up to £2,000 a year more than somebody who is clean living

Boost: Those who drink more than four bottles of wine or 15 pints of beer per week could qualify for up to £2,000 a year more than somebody who is clean living

Currently, those who currently qualify for bigger pensions include anyone who has smoked regularly, is overweight, has suffered heart problems, or is diabetic.

But until now those who are heavy drinkers, but have not had medical treatments or liver problems, have not benefitted.

Edmund Tirbutt, a health consultant and author of Help Them Beat the Booze, said: ‘There is a real danger of insurers sending out the wrong message.

‘It might make perfect commercial sense to offer more to drinkers, but it will verge on the irresponsible if insurers now start using it as a selling point.’

One in five Britons now drinks more than the recommended daily allowance – equal to a pint and a half of beer for men and a glass of wine for women.

And the over-45s are three times as likely as younger adults to drink almost every day, according to the Office for National Statistics.

Medical experts say excessive drinking is the major cause of liver disease deaths reaching a record 11,500 a year – up by a quarter in a decade.

When most people retire they have to turn the money saved in their pension into an income for life.

They do this by buying an annuity from an insurance company.

Excess: One in five Britons now drinks more than the recommended daily allowance

Excess: One in five Britons now drinks more than the recommended daily allowance

How much savers get depends on how long the insurance company thinks they will live. Those in good health get less than those who have been ill.

This is because they are expected to live longer and so the insurer expects the same pot of money will need to stretch out over more years.

While doctors are able to spot many conditions, until recently they have not been accurately able to detect liver damage caused to heavy drinkers.

But now a traffic light system, part of a new blood test developed by scientists at the University of Southampton, reveals damage that would previously have not been spotted.

A red light could indicate irreversible scarring, the researchers told the Mail.

This kind of damage would cut life expectancy dramatically, and lead to a bigger pension payout.

If the test reveals evidence of serious damage, drinkers could see their payouts boosted by as much as 40 per cent.

This would add an extra £2,000 a year to the payout from a £100,000 pension pot.

Billy Burrows, a pension adviser at specialist firm Better Retirement, said: ‘The numbers benefiting from bigger pensions could be set to soar because insurers are increasingly focusing on health issues such as alcohol consumption.’

A spokesman for Aviva, Britain’s biggest insurer, said if the new test is proven to pinpoint liver disease accurately it will offer bigger payouts.

Other insurers including LV=, Partnership and MGM Advantage also said they would welcome results from the test if it proves credible.

Pension company Just Retirement said every factor possible is taken into consideration to calculate how long a 65 year-old retiree is expected to live – and therefore how much is paid out each year.

Steve Lowe, director of the firm, said: ‘We assess someone’s medical conditions and lifestyle so we can estimate how long they might live.

‘The amount of alcohol they consume – and any liver damage – has an impact on health, so it’s a factor we take it account along with many others.’

The comments below have been moderated in advance.

Crikey, I wish I’d known that when I was looking for my pension provider. I could have claimed to smoke 20 a day and drink 4 litres of wine a week and been far better off than I am now! And if I didn’t die when the experts thought I would – hard cheese!

Nell
,

Gosport,
09/9/2012 16:57

I don’t think anyone I know is ever honest when their doctor asks them how much they drink. Now they’re going to have to lie in the opposite direction!

Sarah
,

Glasgow,
09/9/2012 12:00

Anything associated with UK insurance, it is the responsible that is victimised.

zek the 1st
,

bolton-UK, United Kingdom,
09/9/2012 10:24

A case for discrimination???

Maggie P
,

Bedford,
09/9/2012 09:55

I suppose the insurance companies have worked it out that, If they pay out a larger pension the recipicent will die sooner. That will save the insurers a lot of money over the longer term.
Funny old world.

Peter Jones
,

Llanfairpwllgwyngyll, United Kingdom,
09/9/2012 08:52

Will they also take into account that the older you get you can cope with life better through experience. In my case when in my twenties smoked on average 2 ounces of tobacco per day plus 20 non tipped strong tailor made cigs. I used to drink up to 10 pints nightly though averaged 6 but glad to say no spirits.
Early thirty,s I managed to give up smoking. Late fifties gave up drinking to say one bottle of wine per week. Though I found it hard to do I managed it. Now I am not saying every one will do this but a fair proportion will decline over the years the amounts drunk or smoked. Is this a factor as I have not smoked for forty years and drinking only for social reasons, game of cards one night per week. Its easy to just say smokers and drinkers poor risks but is this factor taken into account when filling in a form say for insurance. Decreases are very rarely mentioned.

KenL
,

Andover, United Kingdom,
09/9/2012 08:20

Non smokers, one week before you retire smoke a cigarette, when asked if you have used any tabacco products in the last 12 months tick yes.. hey presto higher payout.
– Sheeple , Essex, 08/9/2012 20:07—————-or you could just, yanno, NOT smoke it and say that you did… :)

Chrysanthemum39
,

Lancashire, United Kingdom,
09/9/2012 00:28

I recently obtained an on line annuity quotation from Aviva just to see what would be on offer.I sat answering a lot of questions and thought to myself it is strange that this annuity provider does not ask any questions about drinking ,just smoking and hey presto it looks like they will in future.

Lesley
,

Northumberland,
08/9/2012 21:33

Non smokers, one week before you retire smoke a cigarette, when asked if you have used any tabacco products in the last 12 months tick yes.. hey presto higher payout.

Sheeple
,

Essex,
08/9/2012 20:07

Excuse me for asking, as I’m not there yet, but do you *have* to have a medical in order to buy an annuity? I’m hoping for a final salary pension (but should that close, it may end up being an annuity).

bootjangler
,

London, United Kingdom,
08/9/2012 18:49

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